Advising the Recently Widowed: How Can You Help?
by Justin C. Duft, JD, CFP, MSFS, CLU, ChFC, CLTC, Commonwealth Financial Network
It's human nature to reach out and help people who are suffering. But sometimes it's hard to know what to do or say. This can be especially true when advising the recently widowed on financial matters. How do you go about offering guidance to those experiencing this emotional and financial transition?
Here, I'll cover some best practices when it comes to meeting the needs of this sensitive client group, as well as positioning your practice to serve those who are recently widowed.
Put Yourself in Her Shoes
Here are two statistics that no wife wants to hear or plan for: 7 out of 10 baby boomer wives will outlive their husbands, and half of all wives will be widowed before age 60. Not only does this translate into a major life change, but it means that a woman may spend several decades making important financial decisions on her own.
To help anyone through a difficult time, you first need to be empathetic. Even if you have never lost a spouse, you can imagine how you would feel after experiencing this loss—scared, sad, alone, depressed, and worried. The last thing a widow wants to hear from her financial advisor is, "Sorry to hear about your loss. I'll send you a list of items you'll need to take care of right away."
A better approach would be to ask, "Can I help you by (and offer something specific)?" Next, begin to help the widow organize her priorities. Remember, most widows are living one day at a time. With this in mind, schedule short, productive meetings that focus on just one or two items. Here are some meeting agendas you might consider during the first year.
Meeting 1
The first meeting is simply to get together. You will:
- Let your client know it's okay to put off making any major decisions for at least a year
- Talk to her about the grieving process (i.e., not thinking clearly, short-term memory loss, changes in eating and sleeping habits)
- Contact insurance companies to process death claims
Meeting 2
The second meeting is a follow-up. You can:
- Review insurance claims
- Set goals for the next meeting
Meeting 3
In the third meeting, work with your client to change account titles:
- Make a list of accounts on which titles need to be changed.
- Gather important documents (e.g., death certificate, appointment paperwork).
Meeting 4
The fourth meeting is another opportunity to follow up with your client:
- Review accounts that have been updated and accounts that need to be updated.
- Set goals for the next meeting.
Follow-up meetings are invaluable. They help keep your widowed client focused on accomplishing one task at a time. Widows need support from their friends and family, as well as from their financial advisor. They are willing to pay for these services, so be sure your fees reflect the additional time you spend helping them.
Be a Go-To Resource
Keep in mind that recently widowed clients usually call their attorney and insurance broker first. If your practice includes insurance and estate planning services, this will instantly position you as the first person to call. Of course, clients don't expect you to be an expert in all areas of comprehensive financial planning. They do expect you to coordinate with other professionals.
Create a professional network. Doctors and attorneys seem to do this best—you expect your primary care physician and family attorney to refer you to a specialist when your needs change. Unfortunately, it can be difficult to find trusted financial professionals with whom you want to work closely. Consider these guidelines as you work to build your network:
- Search for these relationships the same way you would go about finding any professional—ask people for referrals.
- Interview the professional as if he or she were applying for a job at your firm.
- Set clear expectations regarding how you would like the relationship to work.
Tell your clients about your services. Widows often fall into two categories: those wary of being taken advantage of and those who are so overwhelmed that they put their trust in anyone who is willing to take charge of their affairs (without considering his or her qualifications). Therefore, when it comes to needing financial planning advice, they often look to their friends and family for referrals.
One of the best ways to increase your business is through your existing client base. Be sure to let your existing clients know that you specialize in servicing the recently widowed. As you do this, convey all of the things you do that make your services better than your competition's.
Take advantage of the media. Try to develop relationships with local newspapers, magazines, and television networks and identify yourself as a resource for surviving spouse issues. This is easier to do than you might think.
- Write your biography, listing your professional designations, education, and years of experience, as well as what makes you unique. For example, why would someone want to talk to you specifically about helping widows make the transition?
- List media sources where you have been quoted, interviewed, or published—even if it was not on topic. In addition, list any organizations where you have been a guest speaker.
- Call editors to let them know you're available to help. You could write a sample article on financial planning issues that widows face. Remember that once you've been published, it's easier to get published again.
Develop a Standardized Process
It's important to set up policies and procedures that you and your staff can follow with every new widow. For example, create checklists of items to ask about and review during the first two years after your client's loss (e.g., insurance claims, account titling, financial needs). Also be sure to record important dates, such as six months and nine months after the date of death.
- Six months is a significant time period as it marks the alternative valuation date.
- The estate tax return is due nine months after death.
To add a more personal touch, consider sending a "thinking of you" note on the anniversary of the spouse's death. It's not a date people traditionally mark on their calendars, but your widowed clients will remember and will be touched by your thoughtfulness.
Consider Life Planning
What's next for financial advisors who specialize in helping widows make this difficult transition? A growing trend is to offer life planning, defined as the art or human side of financial planning. The growth of life planning is a direct result of what baby boomers are looking for as they grow older and approach retirement age. They are no longer looking for the next best stock tip; instead, they want someone to help them make wise financial decisions.
Go Above and Beyond
Given the life expectancy and widowhood statistics mentioned earlier, you may find a growing demand for advisors who offer services unique to the needs of the recently widowed. Regardless of whether you call yourself a life planner or not, the best way to keep your clients happy and to grow your practice is to take the time to go above and beyond. Be thoughtful and caring, as well as have policies and procedures in place that make providing stellar service a way of doing everyday business.
What tips do you have for advising the recently widowed? Are there specific planning needs that this group encounters? Please share your thoughts with us below.
Commonwealth Financial Network is the nation’s largest privately held independent broker/dealer-RIA. This post originally appeared on Commonwealth Independent Advisor, the firm’s corporate blog.
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